HFMA Gulf CoastMigrating Texas Medicaid to Quality-Based

Alternative Payment Models

Andy Vasquez, Deputy Associate Commissioner

MCS, Quality & Program Improvement Section

Migrating Texas Medicaid to APMs

Participants will:

1. Learn about quality-based alternative payment model initiatives underway by the Texas HHSC that may impact them.

2. Understand the high-level priorities of the Draft Healthcare Quality Strategic Plan and have the opportunity to offer recommendations

3. Know the key factors that HHSC plans to address/accomplish for a successful shift of the Texas Medicaid & CHIP delivery systems to more quality-based alternative payment models.

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Objectives

Migrating Texas Medicaid to APMs

• HHSC APM Initiatives

• HHSC Healthcare Quality Strategy

• Keys to Success

• Other Medicaid & CHIP Topics

3

Topics

Key Medicaid Numbers

• $38.0 billion: Texas Medicaid spending, including Supplemental Health Care Payments

• $ 2.7 billion: Texas Medicaid payments to nursing homes

• $ 3.7 billion: Texas Medicaid prescription drug expenditures

• 78 percent: Texas Medicaid clients under age 21

• 45 percent: Texas children covered by Medicaid or CHIP

• 52.2 percent: Births covered by Texas Medicaid 4

Fiscal Year 2015

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Texas Medicaid Beneficiaries and Expenditures

Migrating Texas Medicaid to APMs

• Goal: Move away from volume-based payment models towards models that link healthcare payments to quality or value

• Related terms:

• Value-Based Payments (VBP) / Value-Based Contracting (VBC)

• Alternative Payment Models (APM)

• See Alternative Payment Model Framework from Health Care Payment Learning Action Network (HCP-LAN.org)

• Quality-Based Payments

• Payment Reform 6

Goals & Terminology

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Don Berwick, Tom Nolan, and John Whittington are credited with first describing the Triple Aim in 2008 for the Institute of Healthcare Improvement (IHI)

Migrating Texas Medicaid to APMs

• MCO/DMO Pay for Quality (P4Q)

• MCO Performance Improvement Projects (PIPs)

• Hospital Pay for Quality Program

• MCO Requirements for APMs with Providers

• Delivery System Reform Incentive Payment Program (DSRIP)

• Network Access Improvement Program (NAIP)

• Nursing Facility Quality Incentive Payment Program (QIPP)

• Multiple DARS, DADS, DSHS Programs

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HHSC APM Initiatives

Migrating Texas Medicaid to APMs

• The redesigned P4Q program:

• Is simpler and easy to understand

• Allows plans to track their performance and predict losses, to the degree possible

• Rewards high performance and improvement

• Promotes transformation and innovation leading to better health outcomes

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HHSC APM Initiatives – Pay for Quality

Migrating Texas Medicaid to APMs

• MCO’s will earn or lose money based on three factors:

• Within-year performance

• Year-to-year individual plan improvement

• Bonus Pool

• To be implemented January 2018

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HHSC APM Initiatives – Pay for Quality

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80

65

89

59

30

83

44

30

79

69

90

65

42

87

42

30

0

10

20

30

40

50

60

70

80

90

100

STAR STAR STAR STAR STAR+PLUS STAR+PLUS STAR+PLUS STAR+PLUS

Well-Child Visits Adolescent Well-CareVisits

Prenatal Care Postpartum Care Diabetes Care - HBA1CControl

Diabetes Care - HBA1CTesting

AntidepressantMedication

Management (AcutePhase)

AntidepressantMedication

Management(Continuation Phase)

2013 Rate 2014 Rate

HEDIS Measures for 2013-2014

Migrating Texas Medicaid to APMs

• Safety Net Hospital Incentive Program,

• Incentives for reducing hospital readmission rates (PPR) and complications rates (PPC)

• Required per Special Provisions Sec. 59(b) of House Bill 1 (2015)

• Disbursed $29.6 million in quality-based payments over the 2015 -2016 biennium.

• Special provision is continued in draft Senate Appropriations bill (SB 1 - Filed) for the next biennium

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HHSC APM Initiatives – Hospital Pay for Quality

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MCO Requirements for APMs with Providers

Migrating Texas Medicaid to APMs

Migrating Texas Medicaid to APMs

• Over 1,300 active DSRIP projects

• 296 providers, including

• Hospitals (public and private)

• Physician groups

• Community mental health centers

• Local health departments.

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HHSC APM Initiatives – DSRIP

Migrating Texas Medicaid to APMs

• In Demonstration Year 4 (DY4)*:

• DSRIP projects collectively provided nearly 6.4 million additional encounters

• Served over 3.1 million additional individuals compared to the service levels provided prior to implementing the projects.

• $9.9B has been paid to date (DY1 – DY5), including $2.1 B paid in January 2017 for DY5 performance.

*Demonstration Year 4 is most recent complete year of reporting; individuals and

encounters may be duplicated between projects.15

HHSC APM Initiatives – DSRIP

Migrating Texas Medicaid to APMs

• 1115 Waiver Update

• Additional 21 months requested: January 2018 through September 2019.

• Requested level funding for both DSRIP and UC, $3.1B per DY (all funds)

• Provides financial and operational certainty for Texas providers to continue serving Medicaid and low-income uninsured populations that benefit from the waiver while the new administration determines its policies regarding Section 1115 Demonstration Waivers.

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HHSC APM Initiatives – DSRIP

Migrating Texas Medicaid to APMs

• Draft program parameters for DYs 7 and 8 released as draft Program Funding and Mechanics (PFM) protocol

• New structure

• Transitions provider payments from project-based to outcome-based for achievement on measure bundles

• Performing Providers report Total numbers and numbers of Medicaid and Low-income or Uninsured (MLIU) individuals served by their system,

• Pay for Reporting for statewide reporting on measure bundles.

• Dependent on CMS approval of the Extension and PFM17

HHSC APM Initiatives – DSRIP

Migrating Texas Medicaid to APMs

• Private Hospital Participation Regional Incentive

• If a region maintains its current level of private hospital participation, all Performing Providers in the region would be allowed to shift 5 percent of their total valuation to the Pay for Reporting category

• DSRIP DY7 Timeline

• February through May 2017 – Gather stakeholder feedback

• March 31 – HHSC Submits PFM Protocol to CMS for approval

• November 30 – Anchors submit RHP plan updates 18

HHSC APM Initiatives – DSRIP

Migrating Texas Medicaid to APMs

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VBP Likely to Survive Post-ACA

18 health systems call on Trump, Congress not to 'reverse

course' on value-based care'The only path to achievable sustainable value-based payment is by aligning private sector and public

sector efforts,' the group wrote

December 9, 2016

The 43-member Health Care Transformation Task Force this week sent a letter to President-elect Donald Trump,

congressional leadership, and other officials urging them to continue efforts to promote value-based care.

In the letter, the task force—which includes health systems, insurers, patient advocacy organizations, and other groups—

wrote that there has been broad bipartisan consensus on the need to promote value-based payment systems to increase

quality and lower costs.

Source: www.advisory.com/daily-briefing/2016/12/09/18-health-systems-call-on-trump

Healthcare Quality Strategic Plan

Source: www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy.html 20

CMS National Healthcare Quality Strategy

Draft Healthcare Quality Strategic Plan

• Keeping Texans well throughout their lifespan

• Serving individuals in the least restrictive setting

• Keeping patients safe and free from harms caused in the delivery of care

• Promoting the most effective practices to improve outcomes for individuals with chronic diseases

• Attracting and retaining world class providers and other health care professionals

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Texas Healthcare Quality Strategy - Priorities

Draft Healthcare Quality Strategic Plan

• Individuals with complex health care needs

• Individuals eligible for long term services and supports

• Individuals with mental health and/or substance use disorders

• Individuals age 65 years and over

• Pregnant women and mothers

• Newborns and children

• Uninsured

• All Texans22

Texas Healthcare Quality Strategy - Subpopulations

Migrating Texas Medicaid to APMs

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Keys to Success: Alignment of Clinical & Financial Models

RHP DSRIP Hospital

and Other

Performing

ProvidersQuality Measures and

Initiatives

Medicaid and CHIP MCO

Quality Measures and

Initiatives (P4Q, MCO VBP, PIPs)

Medicaid Fee for Service Programs

Commercial

CarriersQuality Measures and

Initiatives

Medicare Quality Measures and Initiatives

(ACOs, Hospital Value Based

Purchasing, Hospital Readmissions Reduction Program, MACRA)

Migrating Texas Medicaid to APMs

• Clients/Consumers must always come first

• Accountability at all levels

• Align financial and clinical models between multiple payers, provider types, and populations

• This is a complex and long term endeavor that is occurring in a dynamic state, federal, commercial environment – plan accordingly

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Keys to Success for Shift to Quality-Based APMs

Migrating Texas Medicaid to APMs

• Build in administrative simplification and maintain it

• Timely, comprehensive data and enhanced analytics

• Evolve valuation and measurement processes

• Address challenges of rural providers and small practices

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Keys to Success for Shift to Quality-Based APMs

Migrating Texas Medicaid to APMs

• Block Grants – the future of Medicaid financing?

• Too early to speculate

• NAMD Paper: Technical Considerations on ACA Repeal & Replace

• 85th Texas Legislature

• Focus on value in healthcare

• See Texas Comptroller’s Health Care Spending Report

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Other Medicaid & CHIP Topics

Migrating Texas Medicaid to APMs

• Links at HHS.Texas.Gov:• Quality Improvement

• 1115 Transformation Waiver

• Uniform Hospital Rate Increase Program (UHRIP)

• MCO Pay for Quality (P4Q)

• LTC Quality

• QIPP

• DSRIP Questions:

TXHealthcareTransformation@hhsc.state.tx.us

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Questions & Open Discussion

Andy Vasquez, Deputy Associate Commissioner

MCS, Quality & Program Improvement Section

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Thank you

E-Mail: Andy.Vasquez@hhsc.state.tx.us